Income Beginner: Introduction to Deposit Accounts

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1.
Funds 'swept' from your asset management account are deposited into _______.
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A money market account. This lets unallocated funds earn a higher rate.
2.
Which of the following is a reason an investor might open a deposit account?
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All of the above. Investors open deposit accounts for all of these reasons.
3.
Because deposit accounts pay relatively low yields, investors have little need of them.
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False. Deposit accounts can be useful tools for accumulating investment capital, sheltering funds during market downturns, and maintaining a supply of liquid cash.
4.
An account that combines savings, checking, credit/debit card services, and a line of credit in one account is a(n) _______.
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Asset management account. An asset management account combines many banking and investment features in one account.
5.
All of the following are advantages of deposit accounts except _______.
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High rates of return. High rates of return are not an advantage of deposit accounts, which typically pay lower returns than other investment opportunities.